Every language has made-up words in it. New words for new things are a requirement of language if it is to have any use; the only alternative is to use words from foreign sources.
Where do you think that the word “bentchen” (pardon my Yiddish spelling ignorance) comes from?
Like it or not, lashon kodesh is the language of the Torah and Mishna. It was also the only correct alternative for the language of the State; as has been noted here, a very large percentage of the Jews have no connection to Yiddish whatsoever.
Is it good to keep Yiddish alive? As with any kind of knowledge, of course. It enables us to read literature that would otherwise be forgotten (at least in the original). Is it a priority of the “utmost madrega”? Not to me. First I would like an explanation of why it is holy, and I have not yet seen a convincing one.